Question

11.141.70 h. If reiu bewy, this tand, wWich reture nould you actualy eam?

is now January 1, 2021, and you are considering the purchase of an outstanding bond that was issved on Januacy 1, 2019. It ha

Answer 1

To calculate the return from purchasing an outstanding bond, you need to consider its coupon rate, face value, and time until maturity. Multiply the coupon rate by the face value to calculate the interest earned per year, and then multiply it by the number of years to get the total return.

Step-by-step explanation:

The subject of the question is Mathematics and it is at a High School level. The question asks about the return that would be earned from purchasing an outstanding bond issued on January 1, 2019. To calculate the return, we need to consider the bond's coupon rate, its face value, and the time period until maturity.

1. First, we need to find the number of years from January 1, 2019 to January 1, 2021, which is 2 years.
2. Next, we need to calculate the interest earned per year by multiplying the face value of the bond by its coupon rate. For example, if the face value is $1,000 and the coupon rate is 5%, the interest earned per year would be $1,000 * 0.05 = $50.
3. Finally, multiply the number of years by the interest earned per year to calculate the total return. In our example, the total return would be $50 * 2 = $100.